Which Is The Most Profitable Forex Trading Strategy You Must Learn?I have already been hearing some individuals saying that Forex trading is risky just because a person can lose a lot of money in trading Forex. On one hand, this might be good news because it has somehow deterred some people from trading Forex especially when they're not prepared to get proper education to discover ways to trade well. On another hand, some people have decided to give Forex trading a try, as they have been told it is just a quick to be rich scheme. Unfortunately, they lost their momentum because they might not find any profitable trading strategies and thus, they concluded that Forex trading didn't work.
With due respect, I submit that trading Forex can be quite a successful venture but we should treat it as a significant business and not a quick to be rich scheme. What this means is that individuals must understand the various segments of a Forex trading business. These are trading strategies, money management and trading psychology. In this information, I'll focus on the initial segment - trading strategy.
I believe that it is fair to state that most Forex traders will first learn trading strategies in this business before they consider the other two segments. However, as some individuals take the view that Forex trading is really a quick to be rich scheme, they don't have the patience to complete the necessary work. Instead, their primary goal is to consider the most profitable strategy so that they can make money in the shortest time possible. My question is whether there's such a thing called the absolute most profitable trading strategy. I know by asking this question, I am inviting a debate here since there are a large number of Forex strategies obtainable in the market. Every one of you'll develop your personal opinion. If I could, allow me to first group all Forex trading strategies into four major categories: (i) trend strategies; (ii) trading range strategies; (iii) breakout strategies; and (iv) news trading strategies.
I know what I am going to say below will disappoint some of you - there is no such thing called probably the most profitable trading strategy. As traders, our job is to see the chart of a currency pair and decide when it is in a trend. In that case, we've to use trend strategies because it generally does not sound right to use trading range strategies. Conversely, if the currency pair has formed a trading range, it does not sound right to use any trend strategies. Therefore, we have to use trading range strategies. In a nutshell, a trader will need to learn one or more trend strategy and one trading range strategy.
Some of my trading buddies prefer to trade the Forex market centered on news. What they do is to look for the news to trade and consider what sort of particular currency pair will react after the announcement. Typically, news trading strategies is a quick scalp on a currency pair and derive from an information on a lesser time frame.
Finally, exactly why breakout strategies exist is since there are traders who prefer to take a position on a currency pair after it breaks out of a trading range.
As you will see, different traders could have different trading preference. The very first thing I believe you should do is to discover your personal preference. Are you currently someone who's ultra conservative and you do not want to risk much in a trade? Or are you someone who's aggressive and it is fine for you yourself to cope with higher risk investments?
Although I mentioned news trading strategies here, I don't trade some of them personally because they cannot fit my trading personality. I'm pretty much concentrating on both trend strategies and trading range strategies.
Listed here is another important point for you to consider if you are learning any strategy from another person. I'm sure that the individual from whom you learn will have their own trading rules. You have to ensure these rules fit your personal trading personality. If not, it is likely that strategy won't do the job even though it works for that person. If you choose to tweak these trading rules to accommodate your preference, you should anticipate to spend time on back-testing and forward-testing the modified strategy to make sure that it generates very good results consistently.enter link description here